Stochastic Life-Cycle Cost Analysis for Pavement Preservation Treatments

Abstract

The use of life-cycle cost analysis (LCCA) as a decision-making tool in pavement design and the analysis of competing alternatives is recommended by FHWA. However, dependence on deterministic LCCA raises issues about the accuracy of input information because of the degree of construction price volatility found in the underlying commodities used in pavements. Stochastic LCCA has been shown to produce superior results when used at the new pavement design or network level and is suggested for transportation use by FHWA. However, no project-level tools exist to facilitate use of a stochastic approach to evaluate pavement preservation treatment. This paper proposes a practical stochastic LCCA model on the basis of equivalent uniform annual cost, specifically to compare pavement preservation treatment alternatives. The paper explores statistical LCCA techniques that expose inherent uncertainties to identify and quantify the risk of commodity price volatility. The proposed methodology enhances a pavement engineer's ability to address budget issues, mitigate risk, and justify pavement preservation treatment decisions. Underlying commodity price volatility in pavement treatment costs can be modeled effectively with stochastic LCCA.

Decision to paving solutions in road infrastructures based on life-cycle assessment

“…However, the pavement performance models are necessarily a source of variability regarding the prediction of long term future condition. Also the existing price volatility of pavement materials should guide further developments of LCCA studies to a stochastic approach (Pittenger et al 2012).…”

Empirical Markovian-based models for rehabilitated pavement performance used in a life cycle analysis approach

“…The performance of rehabilitated pavement is required if a long-term life cycle analysis is to be effectively performed for the purpose of yielding the best M&R plan. Recently, several life cycle analysis models have been developed focusing mainly on the life cycle cost analysis but not dealing with the long-term performance of rehabilitated pavement (Heravi & Esmaeeli, 2013;Pittenger, Gransberg, Zaman, & Riemer, 2012;Santos & Ferreira, 2013;Santos, Ferreira, & Flintsch, 2015). Therefore, the main contribution of this paper is the development of two empirical Markovian-based models to be used for predicting the deterioration transition probabilities associated with rehabilitated pavement.…”

Conceptual level life-cycle cost analysis algorithm for low volume bridges

“…While its use in Bridge Management Systems is not widely practiced, LCCA is generally not widely used in transportation decision making, possibly due to the complexities involved with gathering meaningful input data and the challenges of applying concepts of engineering economics (Pittenger, et al, 2012). These issues contribute to the fact that implementation of LCCA is limited (Pittenger, et al, 2012). Most of the states that do practice LCCA, generally apply it only to their pavement management systems.…”

“…The use of EUAC avoids the issues faced with NPV such as the use of a common analysis period. EUAC has been the suggested for transportation decision mak ing especially when the service lives of the alternatives differ (Pittenger, et al, 2012;Sinha and Labi, 2007). The use of EUAC further is justified because public maintenance funds are authorized on fiscal year basis and hence the period of analysis exactly matches the period of fund availability, synchronizing the two to facilitate fund allocation decision making.…”